Axe the Tax! - Foster welcomes growing support for Local Income Tax

11.59.14am GMT Thu 4th Nov 2004

A new independent report published by one of the leading professional accountancy bodies in the UK, the Chartered Institute of Public Finance and Accountancy (CIPFA), has backed plans for a local income tax.

The reports states that the average band "D" Council Tax bill could be reduced to about £600 in England (it's currently £1,121.58 in Bath), if a local income tax (LIT) of 2p in the £1 was used to supplement local authority spending.

Commenting, Don Foster, whose Liberal Democrat Party is advocating using a Local Income Tax to completely replace Council Tax, said,

"The report not only shows that Local Income Tax is practical, it confirms once again our figures.

"These independent experts show that LIT can be administered by the Inland Revenue with no extra burden on employers.

"But Liberal Democrats want to go further. We plan to scrap Council Tax altogether to be replaced by a Local Income Tax of around 3.5p in the £1.

"This report confirms that LIT isn't just fairer, but more efficient. This means that axing council tax for Local Income Tax will produce efficiency savings of around £300 million a year, again reducing the overall tax burden.

"The case for LIT is especially strong in the South West, where high property values outstrip comparative earnings. Of England's 9 Regions, the South West has the third highest house prices, but the sixth lowest average earnings, and this is reflected in the unfair burden on local residents."